By Kieran Allen

1
 Socialist Workers Party manifesto 2

A R ADICAL A GENDA FOR CHANGE :

N INE STEPS TO CHANGE

A T THE START OF 2008, A ‘SOFT LANDING’ was expected after

which economic growth was predicted to resume again.
However by 2009, Paul Krugman, one of the best known US
economists, was describing Ireland as a ‘worst case scenario’.
Warning the US public through the pages of the New York Times,
he rhetorically asked:

How did Ireland get into its current bind? By being just
like us, only more so. Like its near-namesake Iceland,
Ireland jumped with both feet into the brave new world
of unsupervised global markets.1

A radical change of direction is needed and practical solutions

are required that offer a way out of the crisis.
In framing such solutions, our primary concern must be the re-
lief of the majority from social suffering. This represents a break
from the current official thinking which asks: How do we prop up
a business elite even though they helped cause the mess? Fianna
Fáil ministers such as Noel Dempsey may occasionally use radical
rhetoric and describe some of the bankers as guilty of ‘economic
treason’,2 but the government strategy relies on supporting the
same bankers in the hope that trickle-down economics will work
again. It is necessary to break from this doomed approach. If
workers are being asked to clean up the mess, it follows that their
needs and those of the vulnerable in society must be paramount
in framing solutions.
Radical solutions also demand that we step beyond the pa-
rameters set by a for-profit economy. As long as profit is the sole
A Radical Agenda for Change: Nine Steps to Reform 3

motivator of economic activity, we will have to revive balance

sheets and dividend payments before an economy works again.
This means that an even greater proportion of the collective la-
bour of society will have to be given to corporations and investors
before they choose to create jobs. Even if we do all of that, we can
only hope that they have been sufficiently ‘incentivised’ by the
lure of high profits to employ people. We cannot – under the logic
of a for-profit economy – force them to take on workers or estab-
lish new industries and services.
The global crisis, however, makes us confront this strange
logic and we should not let our thinking be dominated by mantras
about ‘competitiveness’ and ‘reducing public spending’. These are
the very mantras which were used to marginalise alternative eco-
nomic approaches and led us directly into the current crisis. In
devising solutions we should acknowledge that this is a systemic
crisis which arose from a search for higher rates of profit. Those
pressures led to over-production and a speculative wave of mad-
ness in the financial sector, so even if the system revives again, the
same pressures will re-emerge in the future.
We need a fundamental change of a system that puts people
before profit and growing numbers are seeking this change. To
date, the people of Latin America have been to the fore in chal-
lenging the constraints of capitalism. They have elected presidents
and governments who have promised to uproot the legacy of neo-
liberalism. These struggles have by no means ended with the elec-
tions and a process of deeper radicalisation is also underway. In
Europe, a new revival of the workers movement has been devel-
oping for some time, particularly in France. This has mainly taken
a political form rather than being rooted in local industrial strug-
gles. Nevertheless, the shift in consciousness to a questioning of
capitalism and a search for alternatives is serious and substantial.
If there was a challenge to the for-profit system in Ireland, it
would most likely take place against a background of other re-
volts or incipient revolts.
A shift from capitalism to socialism requires a dramatic politi-
cal rupture, especially as the current global crash illustrates how
 Socialist Workers Party manifesto 4

every effort to reform the system has proved fruitless. This rup-
ture can only arise from the workers movement, the key agency in
modern society which has the power to re-organise society. A
new society can arise when struggles over exploitation and un-
employment escalate to such degree that they challenge the cur-
rent state. When we make reference, therefore, to the state taking
measures to alleviate social suffering in the proposals which fol-
low, we refer to a state that arises from these struggles and which
represents an entirely different class interest to the present one.
Societies change through mass mobilisation and tumultuous
revolutionary events. These produce a political break from the old
order and the space to re-organise society on a different economic
basis. But once this occurs, the economic transition from capital-
ism to a new form of socialist society is often more gradual. While
workers can take control of a new state apparatus and the main
levers of economic power, a transitionary phase is also necessary.
No society starts anew from scratch with a brand people who
have not been marked by the habits and customs of the old. Bridg-
ing mechanisms are, therefore, required and the proposals below
are an attempt to indicate what a modern day ‘workers republic’,
as James Connolly called it, could do to alleviate the current crisis.
Every solution, from no matter what quarter, advanced for
solving the economic crisis involves a degree of social conflict to-
day. Contrary to the impression given by supposedly neutral ex-
perts, there is no technical fix that can override the question, who
will pay? Different social groups will inevitably advance different
solutions that promote their interests. Business groups have al-
ready, for example, been extremely active in monopolising the
airwaves with proposals for more wage cuts and extra cuts in
their own PRSI contributions. Our purpose here is to advocate al-
ternative solutions that might better suit the needs of the majority
of workers and the poor. The proposals combine, therefore, a vi-
sion of what a different society might look like with certain poli-
cies which can be fought for now in order to stop the majority
paying for the current crisis.
A Radical Agenda for Change: Nine Steps to Reform 5

Reform #1: Stop the bail outs of the banks – create a good
state bank and socialise credit
The bail out of six major Irish banks will cost the population
dearly. According to Standards and Poors, the international rating
agency, ‘the total fiscal cost to the government of supporting the
Irish banking sector could reach between €15 and €20 billion’.3 A
study conducted for the International Monetary Fund put the cost
at 13.9 per cent of GDP, or €24 billion.4 The truth, however, is that
no one knows the exact figure. The Irish state is taking over a
huge level of bad debt and has no idea how much it can receive
by selling underlying assets. More than a decade will pass before
we get some answers.
However, the one thing we can be certain is that the IMF’s es-
timated cost of the bank bail out is higher than the total cost of the
cutbacks in public spending for the next four years. According to
the Department of Finance, the €3.3 billion cuts package of the
2009 budget will be followed by additional cuts of €2.25 billion in
2010 and another €2.5 billion in 2011, and in the subsequent two
years there will be further cuts.5 We can, therefore, assume that all
the suffering that the people in Ireland will endure for the next
four years will simply generate resources to bail out the banks.
This is truly the greatest bank robbery ever perpetrated, only this
time it is by the banks on the wider Irish society.
Why should we do it?
According to conventional theory, the banks are the lifeblood
of the economic system. If they seize up, it is the equivalent to a
heart attack as credit ceases to flow through the system. Every
small shopkeeper needs credit to purchase stock from a wholesale
merchant who in turn needs credit to purchase from the manufac-
turer who needs credit to purchase raw materials. If credit dries
up, the chain of buying and selling in modern society breaks
down. In order to get the credit system re-started, it is argued, the
banks have to be ‘re-capitalised’ with reserves so that they can
borrow more from international money markets and start lending
again.
 Socialist Workers Party manifesto 6

The first part of the argument makes perfect sense. It is diffi-

cult to imagine a modern society that did not use credit to lubri-
cate its economic transactions. But does it follow that the credit
system needs to be organised by the very same bankers who cre-
ated the mess? Even if they were sufficiently ‘re-capitalised’
through a transfer of resources from the wider society, there is no
guarantee that they will adopt lending practices that will facilitate
economic growth. They would be more likely to adopt a restric-
tive lending policy which would constrain economic activity.
An alternative approach is to create a ‘good’ state bank and al-
low the existing bad banks to go to the wall. A mildly reformist
version of this approach has been advocated in varying versions
by Joseph Stiglitz, Paul Romer and the Financial Times columnist
William Buiter.6 An Irish version of a similar proposal has been
made by the UCG Professor of Economics, Terence McDonough.7
Stiglitz, Romer and Buiter advocate it strictly as a temporary
measure that is subject to later privatisation. They also assume
that a good bank should be open to private investors who are
driven by a profit motive. The proposal outlined below, however,
makes no such assumptions.
The first step in creating a good bank is to recognise reality.
The major Irish banks have run up such huge levels of bad debt
that they are now insolvent or virtually so. A recent report from
Goodbody Stockbrokers (a subsidiary of AIB) estimated that the
two leading banks may have combined loan losses of almost €19
billion. But since their combined property and construction port-
folios include about €42 billion in loans to developers, and some
of these may be worthless, these loss estimates could be conserva-
tive.8 In brief, the banks do not suffer from a cash flow or liquidity
problem – they are quite simply broke.
The state should, therefore, withdraw its insurance guarantee
scheme that made it liable for a potential €440 billion for the six
major banks. This can be done by repudiating a costly measure
that was introduced by a government which had close ties to the
bankers. The government was misled by the same bankers about
the true extent of their debts, and this is sufficient grounds for re-
A Radical Agenda for Change: Nine Steps to Reform 7

pudiating the scheme. It is worth pointing out that Arthur Cox,

the company which was paid over €1.6 million to act as legal ad-
viser to Finance Minister Brian Lenihan in drawing up the guar-
antee scheme, was at the same time acting for the Bank of Ireland,
a direct beneficiary of that scheme.9 The government should also
withdraw from the current re-capitalisation programme and re-
coup the €7 billion that was earmarked for Bank of Ireland and
AIB. The effect of both these measures would be the almost cer-
tain bankruptcy of banks.
The main losers would be the major shareholders and interna-
tional bondholders. There are tens of thousands of small share-
holders but many have very few shares. While they might lose
some of their investments, they were taking the same risk as those
who purchased Eircom shares when it was privatised and lost
badly. The big losers would be those who made large, serious in-
vestments. In 2008, for example, there were 148 AIB shareholders
who had major investments of over €1 million. These included
such luminaries as Dermot Desmond, Gerry Gannon, the owner
of the K Club, and Richard Nesbitt, owner of Arnotts. After share
prices began to drop, other wealthy people such as J.P. McManus,
Margaret Heffernan and John Magnier bought up AIB shares,
hoping, no doubt, that the fortunes of the bank would be revived
again. Beyond these major individual shareholders are a further
423 institutional shareholders, some of whose funds were set up
for the express purpose of speculating. Irish society has no more
obligation to support the funds of the wealthy than it has to sup-
port gamblers who lose money on backing horses.
The other losers would be the international bondholders who
provided Irish banks with lines of credit for €150 billion. ‘Bond-
holders’ is a rather nebulous term for other bankers, sovereign
wealth funds and hedge funds, in other words, a host of specula-
tors who gave loans to Irish banks for relatively high risk premi-
ums. Before the Irish government guarantee came into effect in
September 2008, they were charging an interest rate of 5 per cent
for three-monthly loans to banks. The justification for such high
rates was that the bondholders were taking a risk of outright de-
 Socialist Workers Party manifesto 8

fault or impairment for the recovery of only part of the loans. As

the bondholders already built in higher interest charges for risk, it
seems only right that they should accept the losses that are a con-
sequence of lending to bankrupt firms.
If these measures were taken, very rich people will scream and
attempt blackmail in order to secure their money. A government
that wanted to protect its people would need to move quickly and
in a decisive manner. Following the bankruptcy of the old bad
banks, it should pass legislation to take physical control of the
bank property and all accounts within them. This would be neces-
sary to protect the fabric of Irish society from further economic
damage. It should transfer all the deposits and healthy assets into
a good state bank, which would henceforth administer credit for
society at large. It should seize the assets of all rich borrowers
who are unable to pay back the vast loans they used to hype up
the property bubble. In order to reduce fears, the government
should maintain its guarantee scheme for small depositors up to
€100,000.
Such a bold and decisive move would have many advantages.
Most obviously, the enormous costs associated with the bail out of
the current banks would cease and those resources would be
made available for other purposes. The re-organisation of the
banking system would also reduce banking costs significantly.
Instead of six competing banks, there would be one major net-
work that required less office space, less staff and less money
spent on costly advertising. Existing bank staff should be rede-
ployed to other parts of the public service. A good state bank
should also be led by people who take pride in public service and
not by those who demand ludicrous salary packages as ‘incen-
tives’ for their dubious talents.
In the past, bank management teams have presided over sys-
tematic overcharging, tax evasion and speculation. The argument
that we need such corporate leaders to direct us today is demon-
strably false. A good state bank should be overseen by elected
representatives of the people and representatives of the bank em-
ployees. Both should be willing to publish their personal accounts
A Radical Agenda for Change: Nine Steps to Reform 9

in order to ensure there are safeguards against profiteering. To

break from the old culture of corporate cronyism, trained financial
experts, who are willing to work for the average industrial wage,
should be employed to organise the day to day running of a new
state bank.
But what financial experts will work for the average industrial
wage, our current apologists ask? Clearly not those who are used
to inflated salaries and whose primary skills lie in speculating and
playing the casino economy. However, it is precisely such experts
that we do not need. It is not a question of casting out a few fig-
ureheads for the failings of the system but of the removal of a
whole managerial culture. By trained experts we mean those who
have developed accountancy, organisation and information tech-
nology skills to a sufficiently high degree to manage the day to
day running of a new state bank that had banned speculation.
The state also needs to outlaw any participation in speculative
activities. The purpose of a good state bank should be to socialise
credit rather than accumulate profit for the sake of accumulating
profit. Socialising credit means paring down the primary func-
tions of banking to its essentials – lubricating an economy through
credit. In any society, surplus funds will be created in particular
industries or services that are not required for immediate invest-
ment or consumption. On the other hand, there will always be
some who need an infusion of funds but who have not yet earned
them so credit may be advanced in the expectation that they can
repay it in the future. Socialising credit means the organisation of
this function for the benefit of society.
This implies prioritising the allocation of credit for projects
which benefit society as a whole. If credit is in relatively short
supply. it needs to be directed towards projects which create jobs
or which help to create new services for society at large. So credit
might be advanced to small businesses or co-operatives which in-
novate and employ a few score of people. On the other hand, the
concerns of lenders need to be assuaged as one of the largest
groups of lenders in a modern society will be pension funds or the
equivalent of the National Pension Reserve Fund. Instead of raid-
 Socialist Workers Party manifesto 10

ing the latter to put capital into failed private banks, the socialisa-
tion of credit means diverting these funds into longer-term pro-
jects which generate steady income streams such as major electric-
ity or gas generating projects.
State control over banking would provide huge leverage over
the wider economy and this is why it is passionately resisted by
the wealthy. It would give the state greater access to their ac-
counts and ensure that tax evasion and tax avoidance are mini-
mised. By taking control of the land banks of insolvent develop-
ers, the state could engage in a proper housing programme based
on real planning, rather than the chaotic greed-driven develop-
ment of recent years. Repossession of homes during the current
economic crisis could also be prohibited because, among other
considerations, this would merely transfer the problem of ac-
commodation on to other state agencies.
Two standard arguments are normally advanced against state
ownership of banking. One suggests that nationalisation implies
political control and that this leads to cronyism. In other words,
that a nationalised bank would show favouritism to friends of the
political elite, or would be subject to political pressures in its bor-
rowing policies. However, cronyism is hardly confined to state
banking. The AIB managed to fund Charles Haughey’s lifestyle
and wrote off the debts of the former Fine Gael leader Garret Fitz-
gerald. The Anglo Irish Bank was deeply embedded in Fianna Fáil
networks and, according to Sean Fitzpatrick, the secret of its suc-
cess lay in lending to acquaintances made in golf clubs and rugby
clubs.10 Cronyism could arise from state control – but this also de-
pends on the type of state that is controlling the banks. The cur-
rent policy of allowing NAMA to manage the bad loans of devel-
opers who are friends of Fianna Fáil is a certain recipe for the
worst form of crony capitalism. But if there were a popular up-
heaval in society, a new state would represent different class in-
terests. If such a state grew out of a struggle by workers to re-
shape our society, cronyism could be entirely abolished.
The other argument used against nationalisation is that ad-
vanced by Alan Aherne, who moved from being an apparently
A Radical Agenda for Change: Nine Steps to Reform 11

neutral economist to working as a special advisor to Brian Cowen.

He claims that nationalised banks would not be able to raise funds
because ‘investors would surely give the Irish market a wide
berth in the future – not just in the banking sector – if the State
undertook such an extreme step’.11 This argument may be coun-
tered in a number of ways. First, if the state did not lose €24 bil-
lion by bailing out the banks, it would have less need to go to in-
ternational bondholders for funds. Second, such credit is not al-
ways desirable, as the current banks demonstrated when they
used easy credit to stoke up the property market. Third, there is
not one set of bondholders but rather competing interests who
want to lend out money for interest. It would be possible to ex-
ploit the differences between them if some credit facilities were
required. Fourth, the crucial issue for all countries is whether they
will allow themselves to be permanently blackmailed by the
speculators who triggered the current economic crisis. If one
European country which had experienced a social upheaval were
to resist this blackmail, it would garner huge political support
throughout Europe and bondholders might then learn that they
are not the only ones who can wield power.
In making this proposal it is important to distinguish it from a
different type of nationalisation proposed by a group of 20 aca-
demic economists who state that in ‘normal circumstances none of
us would recommend a nationalised banking system’.12 The Irish
crisis is clearly so deep, however, that some of these former neo-
liberal champions now advocate state control. However, the na-
tionalisation they advocate is merely a mechanism to prop up
capitalism rather than creating scope for an alternative to it. It as-
sumes that the state will take on the bad debts of the banks and
that a re-privatisation will follow in later years. The good state
bank being proposed here, however, makes the opposite assump-
tion. The bad debts of the private banks would be repudiated and
private capitalist control of the banking system would be ended
permanently.

Reform #2: Create a major public works programme

 Socialist Workers Party manifesto 12

Unemployment is rising rapidly because of Ireland’s great depres-

sion. In April 2009, there were 372,800 people out work and it is
estimated that 17 per cent of the workforce will be unemployed by
the following year.13 Even these figures may be an underestimate
because a high proportion of Ireland’s workforce are migrants. Un-
der the Habitual Residency Clause, people who have not worked in
Ireland for more than two years are not entitled to claim social wel-
fare. The same applies to Irish people who have not normally been
resident. Some of these people have been forced to join food queues
at the Capuchin Friary in Dublin’s Church Street, where each week
more than 700 people stand in line because they are in desperate
need of basic food items. This shocking scene is a terrible indict-
ment of a failed economic system.
Traditionally, the Irish solution to unemployment was emigra-
tion. The country’s past experience of chronic unemployment
made it a ‘storehouse’ for the surplus labour requirements of Brit-
ain and the US. In the twenty-first century, emigration is return-
ing again with 30,000 people expected to leave next year in search
of work. But unlike the 1950s and the 1980s, when huge numbers
left, this will no longer function as a safety valve for the political
elite. The global nature of the recession and huge job losses in tra-
ditional destinations mean there are few opportunities abroad.
The government will, therefore, be forced to deal directly with
the problem of mass unemployment or, rather, it should if it cared
about its population. But if the strategy is wage cuts to restore
‘competitiveness’, the government will see certain advantages to
rising dole queues. By frightening labour with the prospect of dire
poverty, it hopes to gain leverage to reduce wages. A different
and more radical approach to the economic crisis would, how-
ever, look to a public works programme to alleviate suffering.
One form of a public works programme has already begun in
a mild way in the US, where Barack Obama has inaugurated an
$825 billion package to create three million jobs. This seeks to ex-
pand broadband internet access, to make government buildings
more energy efficient, to improve information technology at hos-
pitals and doctors’ offices, and to upgrade computers in schools. It
A Radical Agenda for Change: Nine Steps to Reform 13

also aims to improve the physical infrastructure of the US and to

facilitate a greater shift to green energy. However, despite
Obama’s rhetoric, the programme is quite limited. There is an
over-reliance on tax cutting to stimulate private business and as a
result the cost per job is far too high. Three million extra jobs in
the US barely compensates for the numbers of people who are be-
ing laid off, and makes only a small dent in the total number of 13
million unemployed.
Japan has already spent over €6 trillion on its public works
programme since 1991. Spending soared in the 1990s as Japan en-
tered a long period of stagnation, was then reduced in 2000, but
resumed again following the latest crisis. Much of the spending
was on large construction projects which were often spread out
over long periods. A report from Japan’s Institute for Local Gov-
ernment, however, found that every one trillion yen spent on so-
cial services like care for the elderly added 1.64 trillion yen in
growth. Financing for schools and education delivered an even
bigger boost of 1.74 trillion yen, the report found.14
Public works programmes can have a beneficial but limited ef-
fect in a capitalist society. If they are based on tax breaks for busi-
ness, as Obama has done, there is no guarantee about the pre-
dicted level of job creation because it depends on the willingness
of private capital to invest. In a different type of society, a public
works programme would be employed as an emergency measure
to create the maximum number of jobs at the lowest cost. Instead
of an exclusive focus on large infrastructure programmes, support
would also be given to other labour-intensive projects which pro-
vide jobs on the average industrial wage. These might include
projects to compensate for deficiencies in healthcare or care of the
elderly.
The state could embark on a public works programme by cre-
ating a state construction agency which took on unemployed
workers directly. Such an agency would eliminate the practice of
cost over-runs which have become a pattern in Irish construction
industry when private companies tender for state projects. This
agency might be formed by the consolidation of construction
 Socialist Workers Party manifesto 14

companies who have been bankrupted by the economic crisis and

by the creation of local authority direct building units.
The distortion of the Irish economy by the property boom
meant that 13 per cent of the labour force was once employed as
construction workers. This is an undesirable situation but, unfor-
tunately, its legacy cannot be eliminated overnight as change will
require the re-training of construction workers to allow them to
access new skills. In the immediate future, however, a public
works programme should include a relatively high level of con-
struction activity as well as other social projects. Possible projects
might include some of the following:
 Upgrading the rail network for freight and the public trans-
port system. The two Luas lines in Dublin need to be joined
up and the networks need to be extended to the outer suburbs.
The abolition of the CIE freight service was an act of social
vandalism that needs to be rectified. Upgrading public trans-
port would help offset fines incurred by the increased carbon
emissions caused by cars. Before the crash, carbon emissions
in Ireland were running at 27 per cent above the 1990 Kyoto
baseline level, even though the permitted level was only 13
per cent. The government was forced to buy carbon credits to
offset this surplus and this was rising to nearly €200 million a
year. Building a proper public transport system would, there-
fore, reduce costs in the long term.
 A housing insulation programme to reduce energy usage.
Ireland’s housing stock is poorly insulated because there were
no proper building regulations before 1991. About 75 per cent
of the stock is pre-regulation and, most likely, uses energy in-
efficiently.15 The current government scheme to provide €100
million for insulation projects is merely a drop in the ocean
and will cover an estimated 5-10 per cent of homes.16 It follows
the standard model of providing grants for house owners to
contract in private firms and will be more costly than it should
be. A mass housing insulation programme undertaken by a
state construction company and requiring smaller matching
A Radical Agenda for Change: Nine Steps to Reform 15

funds from homeowners would be far more efficient. Accord-

ing to the Department of the Environment’s own estimates, in-
sulation could halve heating bills and save the average family
approximately €700 a year.17
 A national network of state regulated, publicly owned or
franchised crèches and care homes for the elderly. The Celtic
Tiger tried to construct a twenty-first century economy on
1950s-style family arrangements as the state assumed that it
was the duty of individual parents to solve the problem of
childcare. At a later stage in the boom it gave tax relief and
provided an Early Childhood Supplement of €1,000 a year for
children under the age of four, but these measures were woe-
fully inadequate in dealing with Ireland’s expensive crèche
fees. The Early Childhood Supplement has since been with-
drawn and children who are aged three years and over have
been offered free places in private crèches. But unless more
crèche places are created, this will produce chaos and a rise in
charges for those under three. The state should live up to its
responsibilities and use a public works programme to estab-
lish a network of publicly owned crèches.
A similarly atrocious situation pertains to elder care as HSE-
provided beds for long stay accommodation for the elderly
have been systematically run down. In 1985, for example,
there were 7,275 beds in geriatric homes but this declined to
6,135 in 2004, even though the elderly population increased.
By contrast, the number of beds in private nursing home in-
creased three-fold. In 2009, a shocking report from the newly
formed Health Information and Quality Authority indicated
that half of the public long stay beds have to be replaced by
2015 because of health and safety concerns.18 The HSE has, un-
fortunately, used this report to start closing down public nurs-
ing homes rather than first providing new homes. The agenda
of the neoliberals who control this agency is, it appears, to cre-
ate even greater scope for private nursing care. A public
works programme should adopt precisely the reverse ap-
 Socialist Workers Party manifesto 16

proach: it should seek to build more public units and staff

them to the highest health and safety standards.
 A network of primary health care centres. Half of all GPs
work as one-person practices and in a report in 2001, the De-
partment of Health recognised the problem, urging a shift to-
wards primary health care centres.19 But instead of building
such centres and staffing them with publicly employed medi-
cal staff, Health Minister Mary Harney handed the project
over to for-profit enterprises like Touchstone. A public works
programme could build such centres and employ staff to run
them. Once again, this would bring a long-term saving to the
state as fewer people would use hospitals and a more sophisti-
cated system of preventative medicine might emerge.
 Develop proper recycling facilities. A considerable amount of
Irish waste is dumped illegally as waste charges are quite
high. In a deep recession, ever more people will feel tempted
to avoid bin charges by burning waste or disposing of it by il-
legal means. A proper recycling infrastructure, created
through a public works programme, would cut back on such
activity and save resources in the longer term.

These are only some ways in which a public works pro-

gramme could help Irish society and there are, undoubtedly,
many others. The key point, however, is to stop another genera-
tion being scarred by the consequences of mass unemployment.
That should be a far more important concern than bailing out
bankers.

Reform #3: Take back Ireland’s natural resources – use the

wealth to build up strategic industries
Most people traditionally assumed that Ireland had few natural
resources and that this explained why industrial development
A Radical Agenda for Change: Nine Steps to Reform 17

was slower to start than its British neighbour. However, in recent

years the full extent of the country’s natural resources is coming
into view.
The Petroleum Affairs Division of the Department of Commu-
nication and Marine and Natural Resources recently issued an
astounding report which noted that there was a potential 10 bil-
lion barrels of oil lying off the west coast of Ireland. That amounts
to at least a value of €450 billion, even on conservative pricing as-
sumptions. Sizeable oil and gas deposits have been pinpointed
along an underwater ridge known as the Atlantic Margin which
runs parallel to the west coast. The Dunquin gas field which lies
200 kilometres off the coast of Kerry contains 25 trillion cubic feet
or natural gas and 4,130 million barrels of oil. The Corrib gas field
off Mayo may have an estimated value of between €6 billion and
€50 billion. New gas and oil fields have also been discovered
inland in the Lough Allen basin. In all, Ireland could be sitting on
hundreds of billions of euro in natural resources, enough to fund
top quality public services that can barely be envisaged now.20
The problem is that much of it has been handed over to Royal
Dutch Shell and Exxon Mobil, two of the nastiest corporations on
the planet. This process began when Ray Burke became Minister
for Energy. He abolished the requirement that the state have a 50
per cent stake in any commercial project and that royalties should
be paid. He also introduced a facility to allow corporations to
write off exploration, development and production expenses ex-
tending back 25 years against tax. The Flood Tribunal subse-
quently branded Burke as the recipient of corrupt payments for
some of his other activities. The former Taoiseach, Bertie Ahern,
added further to the good fortunes of the corporations by cutting
tax rates to 25 per cent and giving them full ownership of the
field. Norway, by contrast, imposes a tax rate of 78 per cent, royal-
ties of 52 per cent and demands a 50 per cent state ownership.
These terms have given Norway one of the wealthiest per capita
incomes in the world.
There is something extraordinarily odd about a population
suffering savage attacks in income standards while so much
 Socialist Workers Party manifesto 18

wealth is meekly handed over to global corporations. One can

only ask: might not these natural resources be used to create new
opportunities to help the country out of recession?
There are some precedents for a more radical approach. In
February 2007, Venezuela’s Hugo Chavez announced a new law
to take control of the last remaining oil production sites under
multinational control. Corporations such as Exxon Mobil, Chev-
ron Texaco, Conoco Phillips and BP were told that they could no
longer control the reserves of the Orinoco Oil Belt. ‘We are recov-
ering property and management in these strategic areas’, Chavez
coolly announced.21 On 1 May 2006, the Bolivian President Evo
Morales also issued a decree assuming control of that country’s
hydrocarbons. Despite ordering his army to raise the Bolivian flag
over production units controlled by foreign firms, Morales’s move
was not quite as radical as some thought. Private companies were
not expelled but were forced to accept taxes or royalties of be-
tween 50 to 80 per cent. As one commentator put it, ‘many aspects
of Bolivia’s nationalisation actually replicate Norway’s oil man-
agement policies, which are known and accepted by the global oil
and gas industry’.22
Ireland could follow either of these options – provided of
course there was a dramatic change in the political landscape. If
the workers of Ireland mobilised and brought about a socialist
society, huge possibilities would open up. A different type of
government could make a careful assessment on purely tactical
grounds as to whether it should impose full state ownership
without compensation or allow a small minority private participa-
tion for a period in order to gain access to a wider skills and tech-
nology base. Whatever option it decided upon would provide it
with a vast new stream of income to develop new strategic indus-
tries.
A publicly controlled oil and gas industry would allow Ireland
to follow the example of Norway in developing downstream in-
dustries. Norway was originally highly dependent on the techno-
logical expertise of foreign companies, but then built up its own
knowledge of extraction procedures, refining and supplier indus-
A Radical Agenda for Change: Nine Steps to Reform 19

tries. Although it still maintains a strong farming base, the coun-

try has risen to become a technological leader in areas connected
with the petroleum industry. This has further stimulated innova-
tion and technological development in its wider industrial base.
With public control over Ireland’s oil and gas industry it
would also be possible to shift ample resources into other areas of
strategic importance. Instead of confining industrial development
to one narrow stream focussed on natural resources, it would be
sensible to initiate other forms of industrial production. Public
ownership is probably the only way that Ireland can recover any
standing in manufacturing and reverse its over-dependence on
the service sector. There are a number of possible industries
which could be developed strategically.
One is a generic pharmaceutical industry. The Irish workforce
has some skills in this area as a result of the location of US corpo-
rations here. But just as the computer industry has begun to shift
away from Ireland, there are also signs that some major pharma-
ceutical corporations could also start to follow suit. On the other
hand, however, the industry is facing growing popular resistance
to its policy of over-charging for branded items. When it at-
tempted to impose scandalous prices for anti-retroviral medicines,
which are used to fight HIV, it was forced to back down and al-
low African countries use the much cheaper generic drugs. De-
veloping a generic drugs industry would run directly counter to
the multinationals but it is what the world needs.
It is also possible to turn Ireland’s present reliance on services
to its advantage. If a sustained and determined effort was made to
re-focus Irish health care onto a strategy of preventative medicine,
new procedures and technologies might be developed. There is a
popular sentiment in the advanced industrial world against an
over-reliance on conventional medical model. While some of this
sentiment is driven by a rejection of corporate science in favour of
more mystical forms of healing, there is also huge scope for tech-
nologies that promote preventative medicine.
These are only tentative suggestions and would require much
more detailed planning. However, the approach adopted here
 Socialist Workers Party manifesto 20

contains two assumptions. First, that a manufacturing base is de-

sirable but it cannot be built up by a reliance on private capital.
Second, there is a considerable discontent in many countries with
the current economic order and a search for new ways of living. A
radical Ireland that re-orientated itself away from corporate
America and produced items which were socially useful could
find new avenues for development.

Reform #4: Redistribute wealth through taxation or con-

fiscation
But where will the money come from? This is a standard question
asked of anyone who promotes the vaguest of progressive re-
forms.
Ireland is now a wealthy country or, more accurately, there are
a lot of wealthy people in Ireland. The problem, however, is not
money but a peculiar tax structure that reflects the neoliberal phi-
losophy that has shaped Irish policy making. Ireland’s tax take is
one of the lowest in the OECD countries, amounting to only 30
per cent of GDP, compared to about 40 per cent in many other
countries. Moreover, a disproportionate share comes from indirect
taxes which tend to hit the poorest harder. There are two main
reasons for this.
First, taxes on income are comparatively low because the gov-
ernment cut PAYE taxes during the boom years as a trade-off for
low pay rises. While workers appeared to benefit, they lost out
when they wanted health care or better classrooms for their chil-
dren. The income tax cuts, however, helped their employers be-
cause it enabled them to give low pay rises in a tight labour mar-
ket. The trade-off between tax cuts and low pay increase was
managed through the active connivance of the union leaders in
social partnership.
Second, the wealthy have a host of ways of avoiding tax or
paying very low rates of tax. The much repeated propaganda
claim that the top 3 per cent of income earners paid 33 per cent of
income tax is highly misleading. This is in fact a classic example of
state manipulation of figures for propaganda purposes. The ‘in-
A Radical Agenda for Change: Nine Steps to Reform 21

come earners’ referred to were what the Revenue Commissioners

call ‘tax cases’, and so a married couple in this data can be a single
tax case. If account is taken of the number of tax cases which are
dual income married couples, the number of earners increase and
earners slip to lower income ranges.23 The figure also only relates
to tax on declared income but, of course, the wealthy also live on
non-declared income and capital. The Bank of Ireland’s Private
Banking Report indicated that the top 1 per cent of Irish society in-
creased their personal wealth by €75 billion between 1995 and
2007.24 Yet the Revenue Commissioners assessed the total income
of the top earners at just €4.7 billion. The discrepancy arises from
the fact that the wealthy have found many different ways to avoid
tax.
To benefit fully from Ireland’s tax loopholes, you need to earn
profits, not wages, and you need to possess capital not labour
power. The Capital Gains Tax provides a useful example. The Fi-
anna Fáil–Progressive Democrat government halved this tax from
40 per cent to 20 per cent, arguing that there would be less tax
avoidance if the rate was reduced. However, the one-time PD
candidate Gerry McCaughey, along with his business partners,
illustrated a loophole to avoid paying a single cent in Capital
Gains Tax. Just before Kingspan acquired his company, Century
Homes, McCaughey transferred his shares to his wife, as did his
brother and another shareholder to their spouses. The transfer of
assets between spouses attracts no Irish tax. Although all three
husbands lived in County Monaghan, their wives ‘lived’ in San
Remo, Italy. A few weeks after acquiring the shares, they sold
them officially to Kingspan. Thanks to a double taxation agree-
ment between Ireland and Italy, the wives paid no tax on the pro-
ceeds of the sale and the Irish exchequer lost €5 million.
This tax avoidance device may sound a little complicated and
slightly inconvenient. So the bulk of Ireland’s wealthy elite have
opted for the much simpler method of becoming tax fugitives. As
long as they stay offshore for a minimum of 183 days a year, they
are non-resident for tax purposes. The wealthy have access to pri-
vate planes, helicopters and even jets so it is difficult to monitor
 Socialist Workers Party manifesto 22

their entry and exits from Ireland, and to date no one has been
prosecuted for faking non-residency status. Strangely, many of
the wealthy do not move their families abroad but allow them to
make full use of Ireland’s public services.
The Revenue Commissioners only began compiling data on
the tax fugitives in 2005. They discovered that 19 of these ‘high
worth’ individuals, or ‘hi wees’ as they were known in banking
circles, had personal fortunes in excess of €50 million. By 2007, the
number of ‘hi wees’ had jumped to 440 and between them they
appeared to control €22.5 billion in wealth. Ireland’s tax fugitives
include the two individuals who control most of the country’s
private media, Denis O’Brien and Tony O’Reilly. Other hi-wee tax
fugitives include Michael Smurfit, J.P. McManus, John Magnier,
Bono and Dermot Desmond; in fact, just about all the richest peo-
ple in Ireland bar, unusually, Michael O’Leary.
Another massive tax loophole was revealed recently in the
Anglo Irish Bank scandal. By using a device called a Contract for
Difference (CFD), wealthy speculators could make a killing on
shares without ever having to buy them – they simply gamble on
the difference in share prices between one date and another. As a
result, the exchequer loses all the taxes and duties that normally
apply when actual shares are traded. When he was Minister for
Finance, Brian Cowen proposed taxing CFDs, but then changed
his mind when he was lobbied by tax accountants for Fianna
F{il’s wealthy cronies.
At a time when the living standards of PAYE workers are be-
ing severely reduced, it is absurd to allow these tax avoidance
schemes to continue. The government says they are closing off
many of the tax loopholes in the current recession, but their ac-
tions are tardy and are not retrospective. In the meantime, the
very wealthy continue to employ sharp lawyers to find out other
loopholes for them to exploit. In order to alleviate the social suf-
fering of the majority, and to provide the state with sufficient
funds for public services, a number of decisive measures are re-
quired to re-distribute wealth. Such measures might include:
A Radical Agenda for Change: Nine Steps to Reform 23

 Legislation to close the tax fugitive rule and to require any

Irish citizen with income over €100,000 to pay tax in Ireland or
to risk losing their passports and Irish assets. These laws
should be applied retrospectively to raise funds in the current
emergency.
 Removal of all property-based tax incentives. Although these
have declined since the crash in 2006, the last year for which
figure are available, a total of €464.4 million was provided in
tax relief to 19 property-based schemes.25
 A tax on all income over €100,000 at a surcharge rate of 70 per
cent. This figure might be indexed to the rate of inflation to
ensure that the vast majority of PAYE workers stay out of this
rate in the future.
 Elimination of tax subsidies on private pension funds for
those on incomes over €100,000. The gross cost of tax relief on
private pensions is €2.9 billion in 2006, but two-thirds of it
goes to the top 20 per cent of earners. 26.
 Restore the Capital Gains Tax to at least 40 per cent and close
off loopholes.
 A sharp reduction in inheritance tax allowances on large
businesses and farms. Those who claim that their wealth is
based on either the merit of hard work or ‘risk-taking’ should
not be able to avoid inheritance tax.
 The introduction of an annual 3 per cent wealth levy on all
income-producing assets and houses, except the family
home, for those earning twice the average industrial wage.
The government has imposed a pension levy on public sector
workers and other levies on all PAYE workers. Why not re-
verse this policy and introduce a wealth levy?
 Removal of the subsidy for fee-paying schools. Each year,
€90 million is made available by the Irish taxpayer to private
fee-paying schools. Parents who collect Tesco tokens to get the
odd computer for their children’s classrooms generously do-
 Socialist Workers Party manifesto 24

nate, through their taxes, to schools with private swimming

pools.
 Support European-wide harmonisation of corporate profits
tax. The 12.5 per cent tax rate has been promoted as Ireland’s
trump card in attracting multinational investment. But, as we
saw in Chapter 1, it has triggered off a race to the bottom and
a number of Eastern European countries are starting to under-
cut it in special economic zones. Ireland can either try to fur-
ther decrease its tax on corporations or support a high stan-
dard rate of corporation tax across Europe.
 Use some of the tax revenues raised by these measures to cut
VAT rates and stealth taxes. Ireland has one of the highest
VAT rates in the EU so it is no wonder that thousands travel
across the border to do their weekly shopping in Newry and
Strabane. Bin charges fluctuate but can reach between €400
and €500 a year. If we adopted the proposals above, we could
cut VAT and eliminate bin charges.

Proposals to raise taxes always appear hard and uncaring,

whereas advocacy of tax cuts looks soft because they are sup-
posed to be victimless, yet nothing could be further from the
truth. When neoliberals propose reductions in taxes on wealth,
they never specify which public services must be cut back even
though there will less money for them. It is perfectly valid there-
fore to ask them about which services should be slashed. Should
there be fewer teachers or longer waiting times for hospital opera-
tions? Should there be a reduced fire service or fewer inspections
on water quality?
As the country is facing an emergency, these proposals will
need to be supplemented with more radical action. With so much
economic destruction being caused, society has every right to con-
fiscate the assets of super-wealthy individuals in order to provide
basic services. If there has to be a choice between cutting social
welfare and taking the assets of the rich to sustain minimum liv-
ing standards, a decent society would choose the latter. In addi-
A Radical Agenda for Change: Nine Steps to Reform 25

tion, the wealthy will also attempt to resist extra tax impositions
and so a policy of confiscation is the only sure deterrent.

Reform #5: Reform the public sector – remove the corporate

ethos
Our approach so far has been to promote far greater control by
the organised public over the economy. If society is not to be at
the mercy of the for-profit sector, it will need further nationalisa-
tion.
So Eircom, for example, should be brought into public owner-
ship to facilitate the development of a broadband infrastructure as
it is a scandalous example of privatisation. When it was first
floated on the stock market ten years ago, it was valued at €8 bil-
lion, and was entirely debt-free. It provided what appeared to be
secure, unionised jobs to 9,000 people, and was investing strongly
in the creation of a modern telecommunications infrastructure,
something Ireland desperately needed. But recently a group of
Australian financiers offered a mere €95 million for the company,
or just over 1 per cent of what it was worth a decade ago. The rea-
son is that the company has debts of almost €4 billion, up from
zero in 1999. The workforce has been slashed to 7,000 and another
1,250 jobs are on the line. After ten years in private hands, Eircom
has managed to connect only 23 per cent of all households to
broadband. In South Korea, 93 per cent of households have
broadband. Most of the countries that are considered Ireland’s
economic ‘competitors’ would be close to the 80 per cent mark.
The situation has become so bad that even Fine Gael are calling
for its re-nationalisation.
Another area needing greater public control are the projects al-
located to Public Private Partnership (PPP) schemes. Five PPP so-
cial housing regeneration projects in Dublin’s inner city have col-
lapsed because the developer, Bernard McNamara, claims that
they are no longer economically viable. In other words, market
conditions have changed and his profit margins have fallen. The
hopes of working class communities, who waited many years for
improvements, were shattered. This example indicates that pro-
 Socialist Workers Party manifesto 26

jects such as schools or cancer care units which have been en-
trusted to PPPs can also be subject to market fluctuations. Even if
this were not to occur, PPP projects cost more than if the state
provided the services directly. The Comptroller and Auditor Gen-
eral found that schools provided under the PPP route cost be-
tween 8 to 13 per cent higher than the traditional route.27
But if we advocate an increased role for the public sector, then
we also need genuine reform. Under capitalism the public sector
has suffered from an excess of bureaucratisation and, in certain
areas, a stifling atmosphere which crushes initiative and creativity
from staff. This problem will not be solved by importing private
sector practices because, contrary to some myths, bureaucratisa-
tion also occurs in the private sector. As Max Weber, the classic
writer on bureaucracy once noted: ‘The very large modern capital-
ist enterprises are themselves unequalled models of bureaucratic
organisation.’28 Bureaucracy arises when a hierarchy exercises
command through its control over knowledge and, if anything,
corporate methods have only increased this method of rule in the
public sector.
Genuine reform of the Irish public sector in a society that is
moving towards socialism means expelling this corporate ethos
and reducing the layers of management which have created ex-
cessive paper work. Reform measures might include:
 A maximum salary of €100,000. The salaries of all those who
earn more than €150,000 should be cut immediately and over a
period we should move to the notion of a maximum salary of,
probably, €100,000. We should recruit people into leading po-
sitions who have a real commitment to the public sector and
develop a value system that is motivated by an ethos of serv-
ing people.
 End the practice of managerial ‘performance bonuses’. These
bonus payments come from the corporate sector and are open
to manipulation. Is performance in the HSE, for example, de-
fined by artificial targets or by a genuine rise in the well being
A Radical Agenda for Change: Nine Steps to Reform 27

of patients? If there is improved ‘performance’, it is hardly the

work of one individual.
 Abolish spending on external consultants. The neoliberals
tried to re-shape the public sector by using consultancy firms
such as IBM who were supposed to have a special organisa-
tional expertise. Yet the evidence suggests that their activities
are costly and wasteful. The Personnel, Payroll and Related
System (PPARS) in the HSE, for example, was a human re-
source management and payroll information system. It was
supposed to offer better financial management but it ended up
costing €131 million before being finally scrapped. The differ-
ent sets of consultants hired to offer ‘project advice’ on PPARS
included Deloitte and Touche, Hay Market Consultants,
ReedSmith Healthcare and IBM. None of them challenged the
continuation of the project because of rising costs, and for that
reason alone these consultants should be banished from the
public sector forever.
 Abolish the use of external public relations firms. This is an-
other practice which was imported from the corporate world.
Expensive, glossy and information-poor publications are pro-
duced by many state agencies and commissioned from private
PR firms. The absurdity was shown when FAS paid €91,000 to
the PR firm Murray Consultants for advice on how to handle a
controversy that had arisen from a Dáil Committee investiga-
tion into FAS’s waste of money.29
 Cut licensing fees to Microsoft – move to open source soft-
ware. A number of German states are increasingly using open
source software to avoid paying Microsoft’s exorbitant fees. If
the Irish public sector adopted open source software, or sim-
ply refused to pay Microsoft’s tariffs, it would eventually save
a vast fortune.
 Eliminate tendering for outside contractors by doing work
in-house. This is another costly measure foisted on the public
sector, often by the neoliberal measures enshrined in EU trea-
 Socialist Workers Party manifesto 28

ties. The philosophy was to replicate market conditions and

force groups like council employees to ‘compete’ for their own
work against outside contractors. Private firms, however, learn
to cut corners and write tenders in ways which reduced the
quality of services. The whole procedure costs vast sums in
paper work and needlessly duplicates existing capacity.

These measures show how costs can be cut if we challenge the

corporate culture imposed on the public sector. But how can the
creative energies of its staff be unleashed? Neoliberals assume
that public sector staff are themselves the problem because they
are unionised and feel able to assert their rights. Hence the bizarre
charge of public sector privilege which emanates from a private
media owned by tax fugitives who do not pay for its upkeep.
Linking efficiency in the public sector to a worsening of condi-
tions for staff is inherently counterproductive. You cannot bash
public sector workers and then expect to find high morale among
service providers.
We, therefore, make the opposite assumption. Nurses, teach-
ers, firefighters, social workers, council gardeners or maintenance
staff have much to offer but are currently oppressed by a culture
of managerialism. Giving staff a real opportunity to make deci-
sions on how to run a better public service will benefit everyone
as long as it is not used as a fake tool to cut staff numbers or in-
crease workloads. This means a break from the spurious forms of
consultation, often staged by external consultants, where out-
comes are decided in advance and where management is merely
‘scoping’ to find potential sources of opposition.
A number of measures would help here. In a socialist society,
there would be monthly meetings organised on a non-hierarchical
basis where staff are allowed to propose changes in the organisa-
tion of the service. Instead of managers chairing staff meetings
and droning on to assert their authority, chairing could be rotated
and an open agenda set. Management should be held accountable
to these meetings for their actions.
A Radical Agenda for Change: Nine Steps to Reform 29

Union representatives should also be given seats on co-

ordinating bodies which oversee state agencies. During the neo-
liberal years, these were stuffed full of corporate representatives,
as the example of the HSE illustrates. The current ten person
board of the HSE includes Willie O’Reilly, the CEO of Today FM;
two bankers, Pat Farell, the chief executive of the Irish Banking
Federation and Donal de Buitleir, a General Manager, Office of
the Chief Executive, AIB Group; Eugene McCabe, a partner in the
solicitors firm Arthur Cox and a council member of the Dublin
Chamber of Commerce. The chair is Liam Downey, a former chief
executive of Becton Dickson, a medical technology company and a
one time member of the National Executive of IBEC. A more un-
representative sample of Irish society could barely be imagined.
Would a revamped HSE be in a worse state if its board was com-
posed of trade union representatives as well as representatives of
the poor and the underprivileged?
To reverse the absurdity of the neoliberal years, a change in
language might also be encouraged. People who attend hospitals
or universities are not ‘customers’ or even ‘clients’. They are not
walking wallets to be pounced on for cash. They are, and should
be known as, ‘patients’ and ‘students’ who have social rights that
are valued.

Reform #6: Build a real knowledge society that expands the

intellectual capacity of all
The government claims that the long-term answer to the collapse
of the Celtic Tiger lies in creating a knowledge economy, or a
‘smart economy’, which is based on innovation. The concepts are
vague and are drawn from development theory but the desire
among the population for a more scientific culture is real.
However the current state strategy relies on ‘incentivising’ el-
ites rather than laying a real foundation for the advancement of
science. It looks for shortcuts by trying to attract international ‘su-
perstar’ academics to lead research teams which are staffed with
researchers who are kept on roll-over contracts. Much of the re-
search is tailor-made to the immediate needs of corporations. The
 Socialist Workers Party manifesto 30

government has also failed to invest in proper educational

equipment for the young during the boom years of the Celtic Ti-
ger. To counteract this short-term strategy, the following meas-
ures are required to upskill the population.
 Reform and expand FÁS to re-skill redundant workers. FÁS
is an example of a state agency with a dedicated staff but with
an appalling management structure. The political elite and
small private business groupings saw it as a soft touch for jun-
kets and inflated contracts.30 The management structure
should be totally cleaned out and the agency should concen-
trate on its real purpose, training and re-skilling workers. Re-
dundant workers should be paid an agreed rate while taking
up these courses for a limited period.
 All third level institutions should ensure that at least 25 per
cent of their intake is from mature students. Universities
need to be re-organised to end elitist forms of governance and
to open them to representatives of the people, while still guar-
anteeing intellectual freedom. They need to reach out to ma-
ture students, as only 13 per cent of college entrants come
from this category at present.31 The National Plan for Equity of
Access to Higher Education has set a target of a 20 per cent in-
take for full-time entrants from 2013, and 27 per cent for all
(full-time and part-time) by the same date.32 These are pro-
gressive targets but need to be brought forward and ex-
panded. All universities should be forced to comply with them
and adequate resources should also be provided for access
courses to facilitate this change. There should be proper long-
term investment in community-based adult education pro-
grammes.
 Abolish fees for part-time or night students – do not bring
back fees for day students. The participation level of students
from manual working class backgrounds and, particularly,
from skilled working class backgrounds has increased since
fees were abolished. Over 50 per cent of the children of skilled
workers and 30 per cent of those of semi-skilled workers now
A Radical Agenda for Change: Nine Steps to Reform 31

attend higher education.33 However, a PAYE worker who

wants to take a college course at night still has to pay fees,
even though the course may be exactly the same as that which
is offered to daytime students.
 Introduce a Return to Education credit. Workers should be
allowed to build up credits to gain time off to access colleges.
That would offer a real second chance at education.
 Invest in laboratories in schools. The quality of Irish educa-
tion is high but too often it can be based on rote learning be-
cause of examination pressures. Schools laboratories should be
fully equipped and employ laboratory attendants to encourage
a practice of experimentation.
 Create a full-time cohort of scientific researchers in the third
level institution. You cannot build a twenty-first century
knowledge economy on nineteenth century forms of casual la-
bour. Each research institute needs a core of full-time re-
searchers who build up skills and capacities.
 Abolish rules of intellectual property which impede the pro-
gress of science. These give ownership of knowledge to indi-
viduals who seek fees for its use. According to one study, only
14 per cent of US experimental biologists are now willing to
talk openly about their current research.34 Science is impeded
when knowledge is privatised and barriers are created against
pooling research insights.

Reform #7: A state guarantee of the right to work

During the last great depression in the 1930s, Fianna Fáil boldly
asserted that the state had a duty to its citizens to guarantee a
right to work. They issued a leaflet to counter a statement from a
Cumman na nGaedheal Minister for Industry and Commerce, P.J.
McGilligan, who said, ‘It is not the function of the D{il to provide
work and the sooner this is realised the better < people may have
to die in this country from starvation’ with one from Eamon de
Valera where he stated that, ‘I hope it is the primary duty of a
 Socialist Workers Party manifesto 32

modern state to ensure that every man who is able and willing to
have work will have work, so that he may earn his daily bread’.35
As the spectre of mass unemployment returns it is ironic that
the rhetoric of a conservative republican politician of the 1920s is a
great deal more progressive than anything offered by mainstream
political leaders today. Or at least it would be if it was shorn of its
sexist references. Society has indeed a duty to share out work, and
to ensure that those who want work can find it, and the measures
to ensure that include:
 A reduction in the working week to 35 hours to create jobs.
In 2000, the French government passed a law to reduce the
working week to 35 hours, without loss of pay. The measure
was fiercely resisted by employers and they eventually over-
turned it when the current Prime Minister Sarkozy came to
power. But one study showed that this mandatory measure,
and its voluntary predecessor, had created 285,000 jobs in five
years and contributed to a drop in the rate of unemployment.36
 No business declaring profit should be allowed to declare
redundancy during the current economic crisis. The political
establishment talk about ‘sharing the pain’ but there is little
sharing when profits rise and workers lose jobs. Workers who
occupy their workplaces to save jobs should be fully sup-
ported. If it is permissible to interfere in the market to rescue
banks, then the same applies to those who occupy workplaces
to save jobs, such as occurred in Waterford Crystal and Vis-
teon in Belfast.
 Corporations that seek to move elsewhere to benefit from
cheaper labour costs should be required to pay back state
grants and tax subsidies. Dell received €55 million in grants
for its Limerick plant, so why should it be let walk away with-
out re-paying it? Special claw-backs should also be introduced
on depreciation allowances, on tax write-offs for past losses
and on fees earned from patents in software and pharmaceuti-
cals. Funds gained should be used to support alternative
forms of employment for those declared redundant.
A Radical Agenda for Change: Nine Steps to Reform 33

 Develop a proper social economy that values work labelled

as unproductive because it does not generate profit. A social
economy could employ thousands on care work, on develop-
ing community activities, on ending the isolation of the eld-
erly. In the immediate term, the cuts in the Community Em-
ployment Schemes should be reversed as these schemes per-
form valuable services and help generate a real community
spirit.

Reform #8: Protect pensions – create a guaranteed income

for the elderly
The current crash has set off a pension time bomb under Irish so-
ciety because employers forced workers into defined contribution
schemes. A disproportionate share of Irish managed pension
funds has been invested in the Irish stock exchange – which has
fallen faster and more dramatically than elsewhere.
 Increase the social welfare pension to at least 50 per cent of
the average industrial wage. The social welfare pension ac-
counts for 60 per cent of pensioners’ total income and 80 per
cent of the income of the poorest three-fifths.37 The increased
costs could be partially offset by reducing tax relief on the
pensions of those who earn more than €100,000. A small group
of people earning over €250,000 annually shared a staggering
€121 million in tax relief in 2005. (The 2009 Budget cut this
earning ceiling to €150,000 a year).38
 Turn the Social Welfare pension into a guaranteed income
for over-65s. There are many complications arising from in-
complete records and means tests, and women are particularly
disadvantaged as they often provide care for children and eld-
erly relatives. Women who worked in the civil service until
1973 were forced to leave work and were not entitled to a pen-
sion in their own right. The social welfare pensions should
therefore be universalised, transforming them into a guaran-
teed income that is available for all long-term residents who
reach 65.
 Socialist Workers Party manifesto 34

 Require employers to make a mandatory contribution to an

employee pension fund. Currently employers need only to
facilitate a workers’ access to a private pension fund. In Nor-
way, however, they are legally obliged to make a minimum 2
per cent contribution each year. There is no reason why it
could not be considerably higher in a different society.
 Ban pension investment in hedge funds and abolish fees
charged by pension fund managers. Nothing illustrates the
absurdity of modern capitalism more than the way the savings
of working people have been squandered by the pension in-
dustry. Pensions were recklessly invested in speculation to
achieve ever higher returns for fund managers. There should
be a European-wide ban on this activity and only a fractional
charge to cover administration. A special state bond should be
established to receive pension investment and to repay future
generations. The National Pension Reserve Fund should with-
draw from speculative activity and contribute instead to long-
term state investment programmes.

Reform #9: Shift from light regulation to heavy regulation

The policy of light regulation helped make the crash deeper in Ire-
land than elsewhere. One of the major public advocates of this
approach was none other than Sean Fitzpatrick, formerly of Anglo
Irish Bank. He was one of the key figures who successfully cam-
paigned against the Companies (Audit and Accountancy) Act of
2003 which required company directors to issue annual compli-
ance statements about their internal controls and tax law. Accord-
ing to Fitzpatrick, ‘we need to legislate to the necessary minimum,
supplemented by codes of corporate governance and good busi-
ness practice’.39 In other words, he advocated a high degree of
self-regulation. This ‘light touch’ was administered by friendly
regulatory authorities who were stuffed full of corporate advisors
or by state officials who aspired to become corporate executives
on retirement.
To change this, we should:
A Radical Agenda for Change: Nine Steps to Reform 35

 Give a majority representation on all regulatory agencies to

voluntary organisations from civil society, including trade
unions, user bodies, local communities and representatives of
the poor. This would give these agencies more teeth and pro-
duce a better over-sight role.
 Ban anyone serving of these bodies from participating in the
organisations they regulate for at least five years after re-
tirement. This would reduce any incentive to go soft in the
hope of procuring a well paid job afterwards.
 Introduce a whistle blower’s charter to protect workers who
reveal the corporate crimes and misdemeanours of their em-
ployers. Currently, many organisations, including the HSE, at-
tempt to limit the freedom of speech of their employees.
 Expand the number of inspectors in agencies such as the
Health and Safety Authority and the Labour Inspectorate,
and create an inspectorate to oversee landlords. Currently in-
spection of workplaces for health and safety standards or
breaches in labour law is comparatively rare. There is virtually
no oversight on private rented accommodation, whereas in a
fairer society we would value high quality standards.
 Introduce large-scale random audits of companies to ensure
they are compliant with the laws of the country. At present
the Revenue Commissioners only carry out about 400 random
audits and 14,000 target audits a year. Yet these raised €687
million in 2007. Why not increase the number of random au-
dits?

All of the proposals outlined in this chapter are made to ad-

vance a practical social agenda for change. They infringe on the
logic of the for-profit economy because adherence to that frame-
work offers no longer-term solution. Achieving this agenda
would require a degree of popular mobilisation that challenges
the power of the wealthy. In the course of such mobilisation more
proposals for change will emerge and undoubtedly produce even
 Socialist Workers Party manifesto 36

more resistance from privileged interests. This raises the question

of just how practical are such proposals? Is it really possible to
foresee a society where these measures are carried out? In the next
chapter we will discuss this issue.

Endnotes

1 ‘Erin Go Broke’, New York Times, 19 April 2009.

2 ‘Dempsey accuses wrong doers at Anglo of economic treason’, Irish
Times, 24 February 2009.
3Copy of S&P report on http://ftalphaville.ft.com/blog/2009/03/30/54198/
sp-strips-ireland-of-its-triple-a-rating/?source=rss.
4 IMF Companion Paper: The State of Public Finances – Outlook and Me-
dium Term Policies after 2008 Crash, 6 March 2009, p. 17.
5Department of Finance, Macroeconomic and fiscal framework 2009-2013,
pp. 10-12.
6‘ See J. Stiglitz, ‘Let Bad Banks Fail’, Daily Telegraph, 2 February 2009; P.
Romer, ‘Let’s Start Brand New Banks’, Wall Street Journal, 6 February
2009; W. Buiter, ‘The Good bank Solution’ http://blogs.ft.com/
maverecon/ 2009/01/the-good-bank-solution/.
7‘Stop Bailing out bad banks and build a good one’, Irish Times, 24
March 2009.
8 ‘Fairer way to ease the crisis’, Irish Times, 3 April 2009.
9‘Legal Advisor for bank bail out was also acting for BOI’, Sunday Trib-
une, 22 February 2009.
10‘Anglo Books are a who’s who of the Celtic Tiger’, Sunday Independent,
26 December 2008.
‘Nationalised banks would find it harder to get funds’, Irish Times, 25
11

April 2009.
12 ‘Nationalising the banks is the best option’, Irish Times, 17 April 2009.
13A. Barrett, I. Kearney, J.Goggin, ESRI Quarterly Commentary Spring
2009 (Dublin: ESRI, 2009), p. 1.
14‘Japan’s Big Works Stimulus is lesson’, New York Times, 5 February
2009.
15SEI report, Energy Consumption and CO 2 Emissions in the Residential
Sector 1990–2004 (Dublin: SEI, 2005).
A Radical Agenda for Change: Nine Steps to Reform 37

16Press Release, ‘ RESS describe EUR 100 million insulation programme

‘as a drop in the ocean’, 9 February 2009.
17Press Release: ‘Government announces new national insulation pro-
gramme’, http://www.greenparty.ie/en/news/latest_news/govt_ an-
nounces_ new_national_insulation_programme.
18‘HSE must replace half of long stay nursing home beds to meet stan-
dards’ Irish Examiner 8 April 2009.
19Department of Health, Primary care: A New Direction (Dublin: Depart-
ment of Health, 2001); M. Wren, Unhealthy State (Dublin: New Island,
2003), p. 211.
20‘Ireland has 5.4 trillion of oil lying off west coast’, Daily Mirror, 30
January 2009.
21G. Wilpert, ‘Venezuela Decrees Nationalization of Last Foreign Con-
trolled Oil Fields’, Venezuelaanalysis.com, 27 February 2007.
22N. Martinez, Bolivia Nationalization: Understanding the Process and Gaug-
ing the Results (Washington: Institute for Policy Studies, 2007), p. 2.
23‘Revenue data understate contribution of lower and middle income
earners’, Irish Times, 20 March 2009.
24Bank of Ireland, The Wealth of the Nation (Dublin: Bank of Ireland,
2008), p. 12.
25Parliamentary answer to Joan Burton produced in her press release:
New Figures show huge sums spent on property based tax relief
schemes, 17 November 2008.
26Dail Debates, Vol. 665., No 1, 24 September 2008. Reply to written
question 343.
27Comptroller and Auditor General, The Grouped Schools Pilot Partnership
Project (Dublin: Government Publications, 2004), p. 11.
28M. Weber, Economy and Society Volume 2 (Berkeley: University of Cali-
fornia Press, 1978), p. 974.
29 ‘Fas Paid €91,000 for PR advice’, Sunday Tribune, 19 April 2009.
30Dáil Eireann, Committee of Public Accounts, Fourth Interim Report on
Special Report 10 of the Comptroller and Auditor General and Fas 2007 Ac-
counts, February 2009, PRN A9/0015.
31HEA, National Plan for Equity Access to Higher Education 2008-2013
(Dublin: HEA 2008), p. 27.
 Socialist Workers Party manifesto 38

32 Ibid pp 60-61.
33 Ibid p 25
34 J.P. Walsh and W. Hong, ‘Secrecy Increasing in Step with Competi-
tion’, Nature no. 422 (24 April 2003) pp. 801-2.
35 Sean McEntee Papers, P 67/346, UCD Archives.
36‘The French miracle: A Shorter working week, more jobs and men do-
ing the ironing, ‘The Independent, 19 June 2001.
37 TASC, Making Pensions works for People (Dublin TASC, 2008) p. 13.
38 Ibid p. 9.
39 ‘Bill will stifle business – Banker’, Irish Times, 1 May 2003.